Overview of part-time hours

The definition of part-time hours is a standard set by the employer for employees who work less than the full-time standard set in labor laws. Part-time employees work shorter shifts or fewer days, and employers typically offer different benefits for part-time employees.

Who decides what counts as part-time hours?

 According to  the Fair Labor Standards Act (FLSA) , hourly employees can work up to 40 hours each week before receiving overtime pay. While the FLSA does impose limits on work hours, it does not specify minimum limits. Employers decide to hire part-time employees as part of their workforce and set the standards. The calculation of full-time hours is derived from the common practice of working eight hours each day for five work days each week; a common practice for part-time employees is to reduce the work week to four eight-hour days, for a total of 32 hours.

Retail, production and other shift-based employers may also hire part-time employees to meet weekly fluctuations in their needs, such as scheduling their shifts to meet more traffic on weekends.

How do part-time hours affect benefits?

For most employer-offered benefits, the decision to make part-time employees eligible is entirely up to the employer. However, the number of part-time employees and their work hours   do impact an organization's compliance with the Affordable Care Act (ACA) .

According to the ACA, any employee who works more than 30 hours per week is considered a full-time employee. In addition, the law counts all hours worked by part-time employees for less than 30 hours per week toward the  category of full-time equivalent employees (FTE)  . Employers who employ more than 50 FTEs must comply with specific requirements set forth in the ACA.

What is the formula for part-time hours?

The formula for calculating FTE is  as  follows:

Number of full-time employees + (total part-time hours/30) = FTE total

The equation looks like this in an example where 20 employees work 32 hours per week and another 10 employees work 20 hours per week:

20 FTE + (200/30) = 26.66 FTE

If an organization reaches the 50 FTE threshold, the ACA requires it to provide qualified health insurance to 95 percent of its full-time employees or face a penalty. There is no requirement to provide health insurance to part-time employees.